Question Intel Q3 Results

[jpiniero]

https://d1io3yog0oux5.cloudfront.net/_2b116bffa4ca8890f09df4510f3c972f/intel/db/887/8873/earnings_release/Q3+22_EarningsRelease.pdf

They actually technically made a profit (albeit an small operating loss) but CCG revenue was down 17% and Datecenter was down 27%.

Says $3B in "Cost Reductions" in 2023.

 

[moinmoin]

Intel clearly stated (...)

Clickbait is gonna clickbait...

The problem is not that Intel is cutting back and where exactly, that's can be a valid economic necessity. It's that Intel in that situation still promises dividends and continuously rising ones at that. The latter comes at a huge cost which means Intel will have to cut back well beyond economic necessity, it's not unlike the stocks buyback program Intel had going at a time node development needed much more investment than it got.

So giving up needed future competitiveness for some short term shareholder profiteering.

We'd be looking at a fabless Intel.

With the lastest financial shenanigans I'm starting to believe just that is eventually going to happen.

 

[Kocicak]

What appears to be shortsighted decision making in giving up long term investments for momentary appeasing shareholders may have some deeper causes, for example those investments have been planned according to some assumptions that turned out not to be correct.

But when we do not have such information this surely seems like a bad decision.

 

[zinfamous]

They get big because of good decisions and then they make bad decisions and become smaller or bankrupt. Ultimate big corp is government. Such is life.

Government is not a company. It is nothing like business. Stop confusing these things and trying to compare their spending and debt and needs as the same. They couldn't be more opposite, and confusing the two is what leads to terrible decisions about them. Trying to run the Government like a company will only ever be a failure, and has only ever proven to be so when fools attempt this.

That being said, they can both be very stupid entities that make terrible decisions, of course.

 

[TheELF]

The problem is not that Intel is cutting back, that can be a valid economic necessity. It's that Intel in that situation still promises dividends and continuously rising ones at that. The latter comes at a huge cost which means Intel will have to cut back well beyond economic necessity, it's not unlike the stocks buyback program Intel had going at a time node development needed much more investment than it got.

So giving up future competitiveness for some short term shareholder profiteering.

Intel is not cutting back...
They are building up, they are increasing their fabs because that's the best investment into the future that any company could do right now.
They are paying dividends because they are still making enough profit to do so, it would be terrible for them to not pay them.
As I have shown before, intel put 12b into fabs and still put 3b into their vault, even with the "terrible" quarters and paying the dividends.
They are not giving up future competitiveness because they are still building everything they set out to build.

The article doesn't show a shred of evidence that the 4b in question have anything to do with the chips fabs, it's just wild speculations in favor of clickbaiting.

 

[moinmoin]

Intel is not cutting back...

What do you call this?
"The company said actions including headcount reductions and slower spending on new plants will result in savings of $3 billion next year, with annual cuts swelling to much as $10 billion by the end of 2025."

Intel Pledges More Cost Cuts as Sales Forecast Misses Estimates

www.bloomberg.com

What do you call this?
"Intel also paid $1.5 billion in dividends in Q3, an outflow that was financed by the company's cash balances rather than cash generated during the period, a warning sign for its dividend sustainability over the long term."

Intel: From Bad To Worse (NASDAQ:INTC)

Intel has reported another very weak quarter. Collapsing margins in data center is a worrying development. Read more here.

seekingalpha.com

Do you think doing both of these at once increase Intel's future competitiveness?

 

[TheELF]

What do you call this?
"The company said actions including headcount reductions and slower spending on new plants will result in savings of $3 billion next year, with annual cuts swelling to much as $10 billion by the end of 2025."

Intel Pledges More Cost Cuts as Sales Forecast Misses Estimates

www.bloomberg.com

What do you call this?
"Intel also paid $1.5 billion in dividends in Q3, an outflow that was financed by the company's cash balances rather than cash generated during the period, a warning sign for its dividend sustainability over the long term."

Intel: From Bad To Worse (NASDAQ:INTC)

Intel has reported another very weak quarter. Collapsing margins in data center is a worrying development. Read more here.

seekingalpha.com

Do you think doing both of these at once increase Intel's future competitiveness?

Again...intel put 12b into fabs (expanding in general, last 12 months) and still put 3b into their vault.
Why go with clickbait if you have the actual financial statements?

What do you call this?
"Intel also paid $1.5 billion in dividends in Q3, an outflow that was financed by the company's cash balances rather than cash generated during the period, a warning sign for its dividend sustainability over the long term."

Intel: From Bad To Worse (NASDAQ:INTC)

Intel has reported another very weak quarter. Collapsing margins in data center is a worrying development. Read more here.

seekingalpha.com

Here is the full paragraph.

Its operational cash flow was positive in the quarter, amounting to $1 billion, but Intel's capital expenditures were $7.3 billion, resulting in a negative adjusted free cash flow of $6.3 billion. Intel also paid $1.5 billion in dividends in Q3, an outflow that was financed by the company's cash balances rather than cash generated during the period, a warning sign for its dividend sustainability over the long term.

Yeah,Intel's capital expenditures were $7.3 billion...that's money they made in this quarter and spend on expanding instead of putting it into their vaults.
Those 7.3b plus the dividends still equated to a positive bottom line...
How was it financed by the company's cash balances when their cash balance (Retained earnings) grew?

 

[desrever]

The Pax Chipzilla Is Over, And Intel Can’t Hold Back The Barbarians

It is the nature of big tech companies with near monopolies to start looking a bit like Rome in its Golden Age – the Pax Romana that held from when

www.nextplatform.com

Interesting view of Intel's ER relating to DC, pretty brutal breakdowns. Running at negative cash flow.